Case Study: Parts Distribution company struggling to scale due to ineffective e-commerce site and manual processes
Industry: Construction
Company Type: Distribution and Fulfillment
The Challenge
The parts distribution company wanted to expand the number of products sold online, but their website was slow and unresponsive. Their Development team could not figure out why. The company had spent $800K over 8 years building out its e-commerce site, and it was becoming concerning. The company utilizes complex algorithms to manage its parts distribution operations. Meanwhile, the CEO spent 100% of his time in the business 6 days a week maintaining inventory and constantly training new staff on complex, manual processes necessary for daily operations.
The Discovery
Boston BizTech started by investigating the slow database issue. We discovered there was no true database. The Developers created a flat file they used to search for 60K+ parts. We also discovered the company's infrastructure for its e-commerce site (electrical, cooling, network, storage, computing, and security) was unsuitable for the job. Staff turnover was high due to the complexity of the obscure, manual processes.
The Solution
Boston BizTech recommended that the company pause the project and reevaluate the Development team. The CEO made the determination to terminate the team and bring us on to build the proper infrastructure for the job, featuring enterprise functionality without enterprise costs. We implemented an Enterprise Resource Planning (ERP) system to automate the operations management, and new developers were hired to integrate the algorithms into the ERP system. A new data center was deployed along with tools to support the new information security plan. We built the e-commerce site, integrating it with the manufacturing, inventory, and accounting systems, automating the complex, manual processes.
The Impact
The parts distribution company doubled its profits in the following 2 years. It reduced staff from 18 people to 6 and now ships 4X the amount of products. Staff turnover decreased to 2% over the following 2 years. The CEO now spends 5% of his time in business operations and focuses on Market Position and Strategic Goals.
Impact by the numbers
2X company increased profits the next 2 years 2% annual staff turnover
4X the number of products able to ship YOY 95% CEO spends growing the business